Portland Cement Facilities Challenge New EPA Rules

Portland Cement Facilities Challenge New EPA Rules

On December 9, 2011, the United States Court of Appeals for the District of Columbia invalidated and delayed the implementation of certain provisions in the United States Environmental Protection Agency’s (“EPA”) new rules governing hazardous pollutants emitted from cement kilns. EPA passed the rules pursuant to the National Emission Standards for Hazardous Air Pollutants (“NESHAP”) and New Source Performance Standards (“NSPS”) sections of the Clean Air Act.

EPA’s NESHAP and NSPS rules regulate certain emissions created by portland cement facilities. These facilities that create portland cement do so by mixing raw materials in a kiln and heating the mixture to create “clinker,” which is then manufactured into powder. The kiln firing process causes emissions of hazardous chemicals, including particulate matter. Additionally, clinker is stored in large piles, which creates the potential for additional emissions. Several cement manufacturers, including the Portland Cement Association (“PCA”) claimed that the rules violated the Clean Air Act and that EPA acted unreasonably in creating the rules.

The central issue was whether EPA’s development of a definition regarding commercial and industrial solid waste incinerators (“CISWI”), which aimed to create a separate category of stationary sources subject to emission standards distinct from the NESHAP, was vague, ambiguous and overly broad. For example, CISWI would apply to kilns combusting secondary fuels, like solid waste, as alternative fuels. Thus, certain kilns could be regulated under the CISWI provisions even though the facility would not trigger regulation under the portland cement NESHAP.

Moreover, EPA developed the CISWI definition together with its new NESHAP standards, but intentionally failed to finalize the CISWI definition until after it passed the NESHAP. Consequently, several cement manufactures, including the PCA, alleged that EPA should have treated CISWI and the NESHAP as closely interrelated rather than distinct and separate.

Agreeing with PCA’s argument, the court noted that EPA had previously indicated that it would reevaluate the NESHAP standards after finalizing the CISWI definition. However, EPA took a much different course of action. Rather than finalizing the CISWI definition concurrently with the finalized NESHAP standard, EPA proposed CISWI after the comment period for NESHAP closed. Stressing the precedential importance of “reasoned decision-making,” the court chided EPA for willfully ignoring the relevant relation between CISWI and its impact on the NESHAP. The court correctly held that EPA did not have the discretion to apply a dataset before it properly defined “the universe of relevant data.” In short, EPA unlawfully based its decision to postpone finalization of CISWI on a premise that it had already planned to change.

The court went on to require EPA to grant PCA’s petition for administrative review of the NESHAP rule. Additionally, the court delayed implementation of the NESHAP standards applicable to clinker storage piles. As to PCA’s NSPS challenge, the court rejected PCA’s arguments and upheld the rule as a reasonable exercise of EPA’s discretion.

For additional information regarding EPA’s new NESHAP and NSPS rules, contact Frank Deveau or any member of Taft’s Environmental Practice Group.

*Significant contributions were made to this article by Julian Harrell.